The finance sector's firm stance on combating tax evasion in e-commerce

Minister of Finance Ho Duc Phoc spoke at the questioning session on the afternoon of June 4.

According to Deputy Nguyen Minh Hoang (HCMC Delegation), e-commerce is boosting our nation's digital economy. However, e-commerce activities in recent times have been exploited by individuals for trading in counterfeit goods, prohibited items, and items of unclear origin. They also use e-commerce for fraud and asset appropriation.

These violations are becoming increasingly sophisticated and unpredictable in scale and location, particularly in major cities like HCMC and Hanoi. The complexity of e-commerce activities on social networks is also a growing concern.

Therefore, the deputy requested the Minister of Industry and Trade to specify what measures will be implemented in the future to limit and prevent e-commerce violations and the misconduct of these groups, aiming towards the healthy development of e-commerce and protection of consumer rights. Additionally, how will the taxation of e-commerce activities on social networks be executed?

At the questioning session, Deputy Do Chi Nghia (Phu Yen Delegation) noted that live-stream selling on some social networks, such as TikTok, could generate hundreds of billions of dong in revenue in a single day, a very significant amount.

Alongside concerns about managing quality and ensuring customer rights, Deputy Do Chi Nghia emphasized that managing e-commerce platforms with clear identification and registration was easier.

However, individual live-stream sellers pose a significant problem with revenues reaching hundreds of billions of dong per day or per live-stream session, which is not a minor, individual issue.

The deputy argued that if the management solutions for this issue were not well-directed, the regulatory authorities would face immense difficulties, constantly chasing after violations like in a maze, making it very challenging while consumer rights might be affected and the tax authorities could lose revenue.

Responding to some National Assembly deputies' opinions, Minister of Finance Ho Duc Phoc stated that implementing Directive No. 18/CT-TTg of the Prime Minister on enhancing connectivity and data sharing to develop e-commerce, combat tax loss, and ensure monetary security, the Ministry of Finance has decisively directed the implementation of tax collection for e-commerce.

Additionally, the Ministry of Finance has increased publicity and guidance for taxpayers and established an electronic information portal for foreign suppliers to facilitate tax collection in this field.

Regarding the coordination in tax management for e-commerce, the minister stated that the Ministry of Finance has led active cooperation with other ministries and agencies such as the Ministry of Industry and Trade, the Ministry of Information and Communications, the State Bank, and the Ministry of Public Security to enforce e-commerce taxation.

As part of this effort, the Ministry of Finance has connected with the Ministry of Public Security's population database, achieving a 71.37% connection rate with 663,157 connection instances; shared data with the Ministry of Industry and Trade on 929 e-commerce platforms; and verified 361 e-commerce platforms for connectivity and tax management. The State Bank has provided data on 144 million accounts, including approximately 10 million organizational accounts and 134 million personal accounts.

The results indicated that in 2022, tax revenue from e-commerce businesses and individuals amounted to VND83 trillion; in 2023, it increased to VND97 trillion; and in the first five months of 2024, it reached VND50 trillion.

To date, 96 foreign suppliers, including YouTube, Google, Facebook, and Microsoft, have registered and declared taxes amounting to about VND15.6 trillion.

The minister stated that in the future, the finance sector would intensify the implementation of comprehensive tax collection measures for transactions on e-commerce platforms in particular and in the digital environment in general.

Hanoi and HCMC will be the focal points for these efforts. The Ministry of Finance has sent official letters to local authorities to support tax collection on e-commerce platforms, and the tax authorities are concentrating on this work to ensure fairness in taxpayers' obligations to the State.